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On Monday, Stifel analysts reiterated their Buy rating for Limbach Holdings stock (NASDAQ:LMB) with a price target of $141.00. The company, currently trading at $128.22, has demonstrated remarkable performance with a 124.63% return over the past year and maintains a "GREAT" financial health score according to InvestingPro analysis. The reaffirmation follows a series of investor meetings hosted by Limbach’s CEO, Mike McCann, which left the analysts more optimistic about the company’s potential for further margin improvements.
The analysts highlighted several factors contributing to their positive outlook. They noted the potential for additional margin expansion driven by an increased mix of On-Demand Repair (ODR) services, improved SG&A leverage from recent hiring, and progress toward achieving a long-term gross margin target of 35-40% as Limbach expands its offerings.
The report also pointed to opportunities for larger capital programs expected to gain momentum in 2026 and beyond, particularly in the healthcare sector. This is due to the aging mechanical, electrical, and plumbing (MEP) infrastructure in over 65% of U.S. healthcare facilities, which are more than 30 years old, according to a recent survey.
Stifel analysts view Limbach as a standout choice, citing a significant runway for capital program opportunities. They believe that the company’s strategic initiatives and market position could lead to substantial growth in the coming years.
Limbach Holdings continues to be a focus for Stifel, with the analysts maintaining their positive stance on the company’s future prospects and its potential to capitalize on emerging opportunities in key markets. While the company shows strong momentum, InvestingPro analysis suggests the stock may be trading above its Fair Value. Discover 14 additional exclusive ProTips and comprehensive valuation metrics with an InvestingPro subscription.
In other recent news, Limbach Holdings reported impressive financial results for the first quarter of 2025, exceeding market expectations. The company achieved revenues of $133 million, surpassing the consensus estimate of $121 million, with a notable increase in earnings per share (EPS) to $1.12, significantly higher than the anticipated $0.43. Limbach’s adjusted EBITDA also outperformed expectations, reaching $15 million, which was largely attributed to higher gross profitability. Stifel analysts maintained a Buy rating on the company, with a price target of $103, reflecting confidence in Limbach’s strategic direction.
The company’s operational revenue (ODR) accounted for 67.9% of total revenue, marking a strategic shift towards more stable income streams. Additionally, Limbach’s total backlog increased by 15% year-over-year, driven by a 57% rise in ODR. The company also updated its forecast for free cash flow conversion, now expecting approximately 75% of its adjusted EBITDA to convert to free cash flow, an improvement from the previously estimated 70%.
Limbach Holdings is expanding its climate control rental equipment fleet and sales team to support its growth strategy. The company has set a full-year revenue guidance between $610 million and $630 million, with adjusted EBITDA expected to range from $78 million to $82 million. Looking forward, Limbach aims to maintain a CapEx run rate of approximately $4 million and continues to focus on strategic M&A opportunities to strengthen its market position.
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